This is the 33rd year the NAIC has published its annual Insurance Department Resources Report
The National Association of Insurance Commissioners (“NAIC”) has published its annual Insurance Department Resources Report (IDRR). The Report, released in two separate volumes each year, has been published annually for the past 33 years.
The first of the two-volume report focuses on the resources and regulatory activities of the 56 NAIC-member jurisdictions including the 50 states, in addition to U.S. territories like Guam and Puerto Rico. The report is organized into five different sections:
- Staffing;
- Budget and Funding;
- Examination and Oversight;
- Insurance Producers; and
- Consumer Services and Antifraud.
A snapshot of 2019
The major take-aways from Volume One of the NAIC’s IDRR Report include the following:
- There were 5,922 insurers, approximately 32 companies less than in 2018.
- Licensed resident insurance producers top 2.2 million individuals and 237,385 entities.
- While there were fewer companies there was more revenue with the total amount collected during 2019 increasing 4.7% to $26.9 billion
- Across the country, state insurance departments received over 270,000 consumer complaints and 1.6 million inquiries in 2019.
Number of Domestic Insurers & Regulated Entities in Mass.
The chart below shows how many Domestic Insurers there are in each state.
Domestic Insurers in both Massachusetts & New England by type:
In 2017, Massachusetts had 81 Domestic Insurers. As depicted in the visual below, by 2019 the Commonwealth had 79 Domestic Insurers. As for other New England states, Vermont has the most with 108, followed by New Hampshire with 61, Maine with 22, Rhode Island with 28, and Connecticut with 103.
| Type of Domestic Insurer | Massachusetts | VT | NH | Maine | CT |
|---|---|---|---|---|---|
| Life/Annuities | 16 | 1 | 1 | 3 | 26 |
| Property/Casualty | 47 | 11 | 50 | 12 | 65 |
| Health | 13 | 4 | 10 | 7 | 10 |
| Fraternal | 2 | 0 | 0 | 0 | 1 |
| Title | 1 | 1 | 0 | 0 | 0 |
| Risk Retention Group | 0 | 85 | 0 | 0 | 1 |
| Other | 0 | 6 | 0 | 0 | 0 |
| Totals | 79 | 108 | 61 | 22 | 103 |
Foreign Insurers in both Massachusetts & New England by type:
| Type of Foreign Insurer | Massachusetts | VT | NH | Maine | CT |
|---|---|---|---|---|---|
| Life/Annuities | 372 | 330 | 328 | 344 | 356 |
| Property/Casualty: | 722 | 701 | 706 | 725 | 755 |
| Health | 2 | 24 | 35 | 4 | 0 |
| Fraternal | 26 | 14 | 16 | 12 | 35 |
| Title | 17 | 12 | 17 | 18 | 19 |
| Risk Retention Group | 121 | 42 | 78 | 76 | 97 |
| Other | 91 | 37 | 0 | 0 | 0 |
| Totals | 1,351 | 1,160 | 2,214 | 1,179 | 1,262 |
Another interesting graph from the report is the overall trend in the number of domestic insurers since 2011, as depicted in this other graph from the NAIC Report.
2019/2020 Insurance Department Budgets
The Massachusetts Division of Insurance is funded 100 percent by a combination of fees and assessments. For the upcoming year 2021, the projected budget for the Division is $15,636,544. Overall, looking at the past five year period, this represents a 7% increase during the 2017-2021 time period. In comparison with other states, Massachusetts’ Insurance Department is ranked as the 30th largest in the country, similar to years past.
In comparison, the ten states with the largest insurance department budgets are as follows (in descending order of 2019 Budget):
| States | 2021 Budget |
|---|---|
| 1. California | $243,148,000 |
| 2. New York | $159,923,000 |
| 3. Texas | $120,375,343 |
| 4. Florida | $90,218,843 |
| 5. Illinois | $62,311,600 |
| 6. North Carolina | $51,813,063 |
| 7. New Jersey | $50,799,000 |
| 8. Alabama | $50,135,357 |
| 9. Montana | $49,911,567 |
| 10. Ohio | $43,464,169 |
Revenues for Massachusetts and the other New England states
The Massachusetts Division of Insurance had revenues totaling $574,638,457 in 2019. While impressive, they are far below other larger insurance markets such as California which had total revenues of $2,994,145,329, followed by Texas with 2,773,465,548 and New York with $2,493,736,000.
The breakdown of the Division’s funding and expenses is 80% for Administration and Regulation expenses and the remaining 20% covering Operational expenses. Here is a look at the number for both Massachusetts and other New England states:
| Revenues | MA | VT | NH | ME | CT | RI |
|---|---|---|---|---|---|---|
| Total Revenues | $574,638,457 | $91,677,314 | $135,068,820 | $88,761,781 | $223,723,493 | $110,138,041 |
| Total Taxes | $388,158,231 | $57,764,570 | $115,101,544 | $81,680,872 | $76,743,182 | $66,977,855 |
| Fees & Assessments Collected | $186,339,257 | $33,641,944 | $19,397,446 | $6,978,883 | $145,142,277 | $2,610,601 |
| Fines & Penalties | $140,969 | $270,800 | $569,830 | $102,026 | $1,838,034 | $255,363 |
| Other Revenue | $0 | $0 | $0 | $0 | $0 | $40,294,222 |
Financial, Market Conduct Exams and Formal Hearings
The Massachusetts Division of Insurance completed 129 examinations in 2019; with 19 being Financial Only Exams while the remaining 110 identified as Market Conduct Exams.
| State | Financial Exams | Market Conduct Exams | Total |
|---|---|---|---|
| Massachusetts | 19 | 110 | 129 |
| New Hampshire | 4 | 7 | 11 |
| Maine | 4 | 0 | 4 |
| Connecticut | 14 | 56 | 70 |
| Rhode Island | 2 | 0 | 2 |
| Vermont | 13 | 2 | 15 |
Insurance Producers
There were a total of 9.88 million individuals and entities that were licensed insurance providers and producers in the U.S. in 2019. The following chart takes a look at the percentage of Resident versus Non-Resident Producers for Massachusetts as well as for the rest of New England:
Resident v. Non-Resident Producers
| State | Individual Resident | Individual Non-Resident | Business Entity Resident | Business Entity Non-Resident |
|---|---|---|---|---|
| MA | 30,558 | 111,092 | 2,394 | 5,194 |
| NH | 6,549 | 82,301 | 599 | 5,976 |
| ME | 7,450 | 152,652 | 834 | 6,138 |
| RI | 5,443 | 75,496 | 315 | 2,421 |
| CT | 20,912 | 114,036 | 1,709 | 7,596 |
| VT | 2,729 | 68,669 | 178 | 3,822 |
Licensed Producers/Adjusters
| State | Producers | Surplus Line Brokers | Bail Bonds | Adjusters | Other |
|---|---|---|---|---|---|
| Massachusetts | 141,650 | 3,102 | 0 | 326 | 6,198 |
| New Hampshire | 88,850 | 1,829 | 0 | 75,648 | 0 |
| Rhode Island | 81,978 | 1,697 | 0 | 72,665 | 2,288 |
| Connecticut | 143,982 | 2,975 | 341 | 85,865 | 1,026 |
| Maine | 160,102 | 1,984 | 0 | 18,344 | 56 |
| Vermont | 71,398 | 1,465 | 17 | 79,562 | 89 |
Actions Against Producers
The following is a breakdown of the actions taken against producers in Massachusetts and New England during 2019:
| State | Number of Fines | Amount of Fines | Number of Restitutions | Amount of Restitution | Other |
|---|---|---|---|---|---|
| Massachusetts | 30 | $34,200 | 0 | $0 | 0 |
| New Hampshire | 6 | $143,000 | 0 | $0 | 9 |
| Rhode Island | 0 | $0 | 0 | $0 | 0 |
| Connecticut | 12 | $49,750 | 0 | $0 | 9 |
| Maine | 4 | $3,100 | 1 | $50 | 5 |
| Vermont | 2 | $50,250 | 0 | $0 | 0 |
Consumer Complaints & Inquiries
In addition to the above information, the NAIC also tracks the number of consumer complaints and inquiries state insurance departments have received over the course of the year. The following is a breakdown of the complaints for Massachusetts as well as for the rest of New England in 2019:
| State | Consumer Complaints | Consumer Inquiries |
|---|---|---|
| Massachusetts | 2,321 | 11,928 |
| New Hampshire | 873 | 4,546 |
| Rhode Island | 383 | 226 |
| Connecticut | 4,748 | 18,892 |
| Maine | 626 | 5,436 |
| Vermont | 375 | 3,052 |
